Why is a good considered to be inferior by economists?
a. The change in income and the change in demand move in opposite directions.
b. The product has poor quality, thereby lowering demand.
c. The change in income and the change in demand move in the same direction.
d. The product’s demand decreases despite its high quality.
a. The change in income and the change in demand move in opposite directions.
You might also like to view...
In a past fare war, U.S. Air reduced the price of its Charlotte, North Carolina, to New York City round-trip fare from $198 to $138 to match American Airlines. U.S. Air did so reluctantly, saying it would cost the company millions of dollars in revenue. American, on the other hand, believed the fare cut would increase its revenue. What different assumptions about the underlying price elasticity of demand did each airline believe true?
What will be an ideal response?
Which of the following average cost functions suggests the presence of a natural monopoly?
A) AC = 2 B) AC = 100/Q + 2 C) TC = 100/Q + 2Q D) All of the above.
A highly liquid asset
A. must be held for a substantial period of time. B. generally has a very limited market for its resale. C. can be disposed of easily without loss of value. D. has high transaction costs associated with its sale.
If the price of golf balls increases, what will likely happen to the demand for golf club manufacturing employees?
A. It will stay the same. B. It will increase. C. It will decrease. D. Nothing, the two are not related.